Zimbabwe, Russia sign $3 billion platinum deal while Minister summons Chinese company over mining delay

Zimbabwe’s President Robert Mugabe and Russia’s foreign minister, Sergey Lavrov today oversaw the signing of several agreements to develop a $3 billion platinum project in Darwendale near Harare.

It would be the largest single foreign investment into Zimbabwe’s troubled economy and would equal nearly a third of the country’s estimated GDP.

At full project development in 2024, the mine will mine 10 million tonnes of ore to produce 800 000 platinum ounces, pushing Zimbabwe’s output over one million ounces, and create 8 000 jobs.

Zimbabwe’s Pen East Investments has teamed up with Afronet, a consortium of three Russian partners, to form Great Dyke Investments, which is developing the Darwendale project.

GDI is chaired by Hesphina Rukato, a former deputy chief executive at the secretariat of the New Partnership for Africa’s Development (NEPAD), an economic development programme of the African Union.

The first stage of the mine, expected to start this year to 2017, involves a $600 million open pit mine, with a projected output of 265 000 oz per annum creating 2 000 jobs. A PGM concentrator and smelter will also be built during that time.

In the second stage set for between 2018-2021, there would be the extension of the concentrator and setting up of smelter. Output is seen rising to 530 000 oz per annum, with 5 000 jobs added and investment will reach $1.2bn.

Officials said there is a provision for the establishment of a refinery, subject to ongoing discussions, which would bring the total investment level to $4.8 billion.

Russia’s Vneshecombank is lead financier, while Rostec is the technical partner. Afronet and VB Bank signed a funding deal before President Mugabe and Lavrov.

“The advent of the Russians in Zimbabwe’s platinum scene will bring an additional 250 000 ounces to our current output of 430 000 ounces within the next 36 months,” Mines Minister Walter Chidhakwa said at the signing ceremony.

He said the first two years of the project will be open cast mining, going underground in the third year.

The mine has a lifespan of 20 years, with potential to reach 34 years on further exploration and would see the Darwendale concession on 217 million tonnes of high grade ore, compared to Unki Mine’s 76 million tonnes.

Unki is owned by South Africa’s Anglo Platinum and is one of the three currently active platinum miners in the country, along with Mimosa and Zimplats.

President Mugabe lauded the Russian investment as the continuation of historic ties, while Lavrov called Mugabe “a historic figure, an African legend.”

According to officials, exploration started in the early 1990s.

In a related event, Mines minister Walter Chidhakwa has summoned Chinese platinum miner, Global Platinum Resources, over concerns that the company was holding on to claims for speculative purposes.

Chidhakwa said Global Platinum officials are expected into the country next week to update government on their business following its licensing nearly three years ago.

“They are supposed to brief me where they are because the statement I have made is we will not tolerate people who seat on claims,” Chidhakwa told The Source in an interview.

“So they have indicated a desire to come and see me and tell me (where they are), so I’m waiting for them to come and see me and tell me where they are and what they intend to do. Their lawyer is coming in the next week.”

Officials at the platinum miner would not comment.

Global Platinum is a joint venture of Norinco International Cooperation, a state-owned Chinese engineering company and the Zimbabwe government’s mining investment arm, Zimbabwe Mining Development Corporation (ZMDC) on concessions taken from Impala Platinum.

In June last year, the company indicated that it was ready to start mining in September that year.

Zimbabwe has the second known platinum reserves in the world after South Africa, positioning the capital intensive mining sector as the anchor of the economy.

Mining accounts for 55 percent of Zimbabwe’s export receipts.- The Source


1 Comment

Leave a Reply

Your email address will not be published. Required fields are marked *